Dismantling - Bavaria's Metal and Electro-Industry in Decline
Bayern's most important industrial sector is in a bad mood: According to a summer survey by the associations bayme and vbm, the Metal and Electro industry in the Free State expects further deterioration of business conditions in the coming months. In addition, the companies surveyed plan to reduce staff. Bertram Brossardt, the managing director of both associations, warns of deindustrialization.
Some of the most famous Bayern companies belong to the Metal and Electro industry, including Audi, BMW, and Siemens. "Economic weakness and location problems are now endangering the future of our industry," said Brossardt, the managing director of both associations. "A turnaround is nowhere in sight."
According to the survey, almost every second company in the industry assesses the current business situation as bad. The balance of expectations has significantly worsened since winter and stands at minus 31.7 points for domestic business. "We had hoped at the turn of the year that production would only stagnate," said Brossardt. "Currently, we assume that it will sink by two percent on average in 2024."
Less Investment and Employees
Companies are reportedly investing less in Germany. "Every third company wants to invest abroad, and only one in ten wants to invest domestically," said Brossardt. The majority of domestic investments are not flowing into the expansion of production but only into replacing existing assets. "This is a dangerous mix for our location and causes us great concern, as it is a clear sign of an industrial decline that is gaining momentum," said Brossardt.
According to the survey by the two employer associations, the companies therefore plan to reduce their staff. "The companies will have to cut around 7,000 jobs by the end of the year," said Brossardt. He blames "the industrial policy of the last few years."
- Bertram Brossardt, overseeing both bayme and vbm associations in Bavaria, expressed concern about the deteriorating business conditions in the Metal and Electro industry, predicting potential deindustrialization in the Free State.
- BMW, Audi, and Siemens, renowned Bavarian companies, fall under the Metal and Electro industry, and according to Brossardt, their future is now at risk due to economic instability and location challenges.
- The summer survey conducted by bayme and vbm revealed that almost half of the companies in the Metal and Electro industry view their current business situation as poor, with a significant decrease in optimism since winter.
- Brossardt lamented that even though hopes were high for minimal production stagnation at the start of the year, current predictions indicate a two percent drop in average production by 2024.
- Bavarian companies are reportedly investing less in the domestic economy and are more inclined to invest abroad, with only one in ten choosing to invest domestically, as revealed by Brossardt.
- This trend of investing less within Germany and focusing solely on asset replacement has raised concerns among industry leaders like Brossardt, citing it as a sign of a downward spiral in the Metal and Electro industry in Bavaria.
- In accordance with the survey results, companies across the Metal and Electro industry plan to dismantle around 7,000 jobs by the end of the year, attributing this decision to the past few years' industrial policies in the region.
